UK Business News Today: 12 October 2026 | Economy, Markets & Insolvencies

Britain’s approaching Budget, persistent energy-driven inflation and increased financing costs dominate this extended Friday-to-Monday briefing. Retailers and business groups are asking for relief from employment taxes, while weak growth forecasts and uncertainty about interest rates complicate planning. For SMEs supplying on credit, the immediate questions remain whether customers can absorb higher costs, settle invoices promptly and remain financially resilient.

James Salmon, Operations Director.

Key Developments

• The IFS identifies approximately £35bn in spending pressures ahead of the 28 October Budget.
• Inflation is reported at 3.1%, with warnings that energy costs could push it above 4%.
• Major retailers and business organisations continue pressing for relief from employment taxes and other operating costs.
• UK capital markets face renewed pressure to attract investment and retain growing businesses.

Economy & Policy

IFS warns of £35bn Budget challenge

The Institute for Fiscal Studies says the Chancellor faces roughly £35bn in spending pressures if he wishes to protect public services while pursuing higher defence spending. The analysis identifies roughly £9bn in implied cuts outside health and defence, a further £15bn inflation-related squeeze and around £11bn to raise defence spending to 3% of GDP by 2030. Its central projection puts fiscal headroom near £21bn, although estimates remain highly uncertain and other assessments have suggested less room. The 28 October Budget will therefore be important for tax policy, spending plans and confidence in public finances.

August GDP expected to dip

Economists forecast a 0.1%–0.3% contraction in UK output in August following stronger activity in June and July. Professional services and administrative sectors may have softened, while manufacturing is expected to have stagnated. Pantheon Macroeconomics forecasts a 0.3% fall, while RSM UK expects 0.1% but still sees quarterly growth of 0.4%–0.5%. These are forecasts, not an official August GDP result.

Borrowing costs compound the pressure

Telegraph columnist Matthew Lynn warns that UK 30-year gilt yields have moved above 6%, increasing worries about funding costs throughout the economy. His commentary links expensive public borrowing to higher mortgage rates, tighter credit conditions and additional costs for corporate borrowers. He argues that weak investment and insolvencies could further undermine tax receipts. The assessment is an opinion, rather than a settled forecast.

Bank governor urges credible fiscal decisions

Bank of England Governor Andrew Bailey has warned governments to maintain credible spending and tax policies to protect financial stability. UK inflation is reported at 3.1% and could move above 4% if elevated energy prices persist. Bailey cautions that firms and workers treating an energy shock as permanently higher inflation could embed price and wage increases. He also notes that fiscal credibility affects the interest rates investors demand on government debt.

Barclays expects a November rate rise, but fewer thereafter

Barclays chief UK economist Jack Meaning considers a Bank of England rise in November likely, but forecasts only one or two quarter-point increases over the following year. That is less than the four increases the supplied report says markets were anticipating. Meaning points to higher unemployment, restrained wage growth and fragile output as limits on longer-term domestic inflation. The actual path remains dependent on inflation and economic data.

Tax & Government

Employers urge reversal of National Insurance increase

The London Chamber of Commerce is pressing for the rise in employer National Insurance contributions, from 13.8% to 15% in April 2025 alongside a lower payment threshold, to be reversed. It cites a fall of 167,000 employee jobs between October 2024 and April 2025, though this does not alone establish causation. In Chamber polling, 74% of business leaders said a reversal would have a positive effect, and 56% said it could encourage investment. The Chamber also proposes targeted relief for employers hiring some young people outside education, employment and training.

Retail bosses call for a pro-growth Budget

Marks & Spencer chief executive Stuart Machin has criticised earlier increases in employers’ National Insurance and raised concerns about new employment obligations. He wants the Chancellor to prioritise investment, business confidence and household spending power. John Lewis Partnership chair Jason Tarry likewise warned that a proposed warehouse tax could affect more than 200 stores and add pressure to the high street. Such concerns illustrate how large customers and smaller suppliers may experience the same cost squeeze in different ways. .

Chancellor reportedly abandons warehouse tax

Reports now suggest John Healey has ruled out the warehouse tax discussed as a way to help fund rates relief for pubs and music venues. That follows objections from John Lewis and other retailers about the burden of further levies. The announcement remains reported policy positioning ahead of the Budget, rather than a published Budget measure. Retailers are seeking more clarity on business rates and employment costs.

Entrepreneur reinvestment relief under consideration

Treasury officials are reportedly examining reductions or deferrals of capital gains tax for founders who reinvest proceeds in new businesses. Supporters believe this could keep capital in Britain and encourage start-up formation and jobs. One estimate suggests additional annual Treasury receipts of £43m over time, but that is a projected outcome, not guaranteed revenue. Details and eligibility have not been finalised.

Proposed social-care levy for over-40s

Former pensions minister Sir Steve Webb has proposed a voluntary 1p income-tax-linked contribution on basic-rate income for those aged over 40, potentially covering 23 million taxpayers. The annual contribution would be capped at just under £380 and, according to his estimate, could raise more than £3bn immediately. Participants would receive discounts against future care costs. It remains a proposal rather than government policy.

Poll indicates support for wealth and windfall taxes

A Survation poll for Tax Justice UK reports support of 63% for higher taxation of people worth more than £10m, 61% for windfall taxes on bank profits and 62% for similar measures affecting energy firms. Campaigners estimate their preferred measures could raise £36bn annually. These are survey results and advocacy estimates, not Treasury revenue forecasts or agreed Budget changes.

Making Tax Digital software capability questioned

A report says 51 of 138 HMRC-approved Making Tax Digital products lack functionality needed for end-of-year tax returns. Businesses and advisers should check the specific features and obligations of the software they use rather than assume an approved product covers every filing requirement.

Savings starting rate offers extra tax-free interest for eligible households

The £12,570 Personal Allowance can sit alongside a Starting Rate for Savings of up to £5,000, subject to the rules governing non-savings income. The allowance is not a universal £17,570 tax-free earnings threshold and reduces as relevant other income increases. This is primarily a household financial-planning issue rather than a business tax concession.

SME & Business Environment

Free directory helps suppliers identify fast-paying customers

Good Business Pays has launched the Good Business Partners Directory, a free resource identifying organisations recognised for prompt supplier payments using publicly reported payment-practice data. It offers businesses a starting point for researching prospective larger customers and assessing their record of paying suppliers. Its award-based directory is not a guarantee of future payment or a replacement for a credit report and ongoing debtor monitoring.

Employment & Labour

AI adoption divides workplaces

British Chambers of Commerce analysis suggests 54% of UK firms actively use AI. A Deloitte survey of 25,000 workers suggests employees collectively spend about £1bn a year on AI tools for work, with roughly a third of those users doing so without employer permission. Employers face questions about data handling, productivity, staff training and effective governance.

Poor workforce health linked to £241bn productivity loss

Vitality estimates poor workforce health costs the UK £241bn a year in lost productivity, with mental ill-health the leading contributor. It estimates a £7,000 per-employee burden and 30 working days of lost productivity for higher-risk employees. Only around a third of employers in the cited research provide mental-health support. The estimates highlight the financial effect of absence and reduced productivity on businesses of all sizes.

Government considers limits on non-compete clauses

Prime Minister Andy Burnham has proposed examining restrictions on post-employment non-compete clauses, ranging from limits based on salary to a potential ban. The Government argues such clauses can inhibit labour mobility and innovation. The Recruitment and Employment Confederation cautions that broad changes could weaken the protection of commercially sensitive information and client relationships. The final policy remains undecided.

Retirement expectations extend towards 68

Standard Life’s Retirement Voice research indicates that UK workers would like to retire at 62 but expect to work until close to 68. The difference reflects pressure on retirement savings and the affordability of leaving work. For employers, it underlines the value of workforce planning, flexible roles and retaining experience.

Retail & Consumer

Subscription spending keeps growing

Barclays payments data indicates that consumer spending on subscriptions has risen approximately 9% annually since 2023, ahead of overall spending growth. It suggests recurring digital and service payments remain embedded in household budgets despite cost-of-living pressure. Other discretionary purchases may nevertheless face competition for limited income.

Flat sellers face widespread real-terms losses

An analysis of Land Registry data suggests 76% of flat sellers in England and Wales recorded inflation-adjusted losses over the past year. Typical flat values were reported at £215,000, down from £229,000 four years earlier, while the inflation-adjusted comparator was about £269,000. The cited average real-terms loss was £40,000. Weak housing-related confidence can spill into renovation, furnishings and other SME sectors.

Industry & Investment

Airtel Money falls below IPO price on London debut

Airtel Money closed its first London trading day 6% below the 196p offer price after briefly gaining around 2%. The listing valued the business at approximately £5bn and enabled existing shareholders to sell about 270m shares, raising roughly £529m. London has struggled to attract new flotations, and uncertainty over global markets has delayed several planned offerings. The disappointing first-day performance adds to debate over the UK’s access to public-market capital.

LSE chief seeks stamp-duty and dividend reforms

London Stock Exchange chief Julia Hoggett wants stamp duty on share purchases phased out, initially for ISAs and pension funds, alongside renewed incentives for domestic investment. Her proposals would encourage more capital to remain invested in UK companies and make London listings more competitive. They are recommendations to the Government, not enacted tax reforms.

City taskforce warns UK may become an ‘incubator nation’

The Capital Markets Industry Taskforce warns that Britain could nurture successful businesses only to see them list or grow overseas. Its suggestions include stamp-duty relief for pension funds, inheritance-tax incentives and a 10% dividend tax credit, with a claimed potential to mobilise £161bn by 2042. It points to scarce London IPOs and at least £70bn of takeover bids for UK-listed businesses this year.

Treasury indicates openness to capital-markets changes

Economic Secretary Lucy Rigby says the Government continues to examine the competitiveness of UK capital markets and access to finance. Fintech group Innovate Finance is calling for stamp-duty reform, while challenger banks Shawbrook and Aldermore want the banking surcharge threshold raised from £100m to £500m. Tax decisions, Rigby emphasised, remain for the Chancellor at the Budget.

International & Trade

Volkswagen seeks fairer European competition with Chinese carmakers

Volkswagen chief Oliver Blume has called on France and Germany to work together to support European carmaking and ensure foreign manufacturers contribute investment, jobs and local value. His comments follow EU–China trade discussions and reported agreement to limit some Chinese hybrid vehicle exports. The broader challenge concerns vehicle costs, supply chains and industrial employment.

Global Market Summary

Global equity indices

European shares bounced on Friday and extended gains on Monday, led by banks after a difficult fortnight. US shares also recovered on Friday as oil prices eased and investors reconsidered the outlook for AI-linked corporate spending. Semiconductor weakness weighed on Asia: South Korea’s Kospi fell 3.6%, while mainland China’s Shanghai Composite declined 0.4%. The Hang Seng edged higher, helped by banking and trade-related shares.

What moved markets

Energy and geopolitics were central. Reported Houthi strikes on Riyadh airport and an attack on a vessel in the Strait of Hormuz increased concerns about shipping and energy supply, while President Trump’s announced Russia–Ukraine energy ceasefire pulled the other way. The reported ceasefire is a claim requiring confirmation, not an assumed lasting settlement. EU–China trade discussions improved sentiment towards trade-exposed sectors, but bond-market concerns persisted, especially around French public finances. US earnings season, AI infrastructure spending and the prospect of future central-bank rate decisions added to the mixed picture.

Currencies

Sterling was broadly unchanged against the US dollar at GBP/USD 1.3237, up 0.02% from Friday’s 1.3234. Against the euro, GBP/EUR was 1.1826, up 0.11% from 1.1813. French fiscal concerns put modest pressure on the euro while UK budget uncertainty and global rate expectations kept sterling movements limited. Currency volatility matters for importers, exporters and businesses pricing goods with thin margins.

Commodities

Brent crude stood at $105.56 a barrel (+0.80%) and WTI at $92.50 (+0.71%) Prices fluctuated during the morning as competing Middle East risks and ceasefire reports affected sentiment; with Brent near $103–104 earlier and WTI at $91.49. Gold was $4,177.58 an ounce (−0.40%), down modestly as some safe-haven demand eased.

Insolvency Watch

Administrations (7)

• BEWLIEHILL LIMITED
• BUILD A ROCKET BOY GAMES LTD.
• GARDNER & CO. (KENT) LIMITED
• GRAND CENTRAL HOLDINGS LIMITED
• J.A.GLOVER LIMITED
• JETVINE LIMITED
• P.S.R. MANAGEMENT SERVICES LIMITED

Liquidations (47)

• ACTUARIAL CONTRACTORS LIMITED
• AGS LAKE LIMITED
• ALLIED REMEDIAL TREATMENTS LIMITED
• ALLUVION CONSULTING LTD
• ALTUS CONSULTING HOLDING LIMITED
• ALTUS CONSULTING LIMITED
• AVERAQ LTD
• BOLT ANGELS LTD
• CAMBRIDGE STEEL STRUCTURES LTD
• CCHF ALLABOUTKIDS
• CHEVAL ROUGE LIMITED
• CLASS 98 LIMITED
• CLCKWRK LTD
• CLIQUE LTD
• CRIMSON CONSULTING LIMITED
• DAMKAN LIMITED
• DAVID LYTHGOE LIMITED
• DEVTRYX LIMITED
• DMTIGHE LIMITED
• FALKIRK SCHOOLS PARTNERSHIP LIMITED
• GALVEN LIMITED
• HARRISON CAPITAL CONSULTANCY LIMITED
• HH MANAGEMENT SERVICES LIMITED
• INTERLIANT UK HOLDINGS LIMITED
• INVESTMENT FUNDS DIRECT HOLDINGS LIMITED
• J.C.SHIELDS LIMITED
• KIMBLEDALE LIMITED
• LION INDUSTRIES (CARDIFF) LIMITED
• LK DAVIES LIMITED
• NAVISITE EUROPE LIMITED
• NERIN HOLDINGS LTD
• NILOY ROY LIMITED
• OBJECTPOWER LIMITED
• P15M LTD
• PARAMOUNT FINANCE CO.,LIMITED
• SETT VENTURES LIMITED
• SOLUTION DESIGN LTD
• STADE STREET GARAGE LIMITED
• STRATHY CONTRACTS LTD
• SUECHELEC LIMITED
• SYNERVIT LIMITED
• TECHTOPAY LIMITED
• THE CFO CONSULTANCY LTD
• TIME SHIPPING SERVICES LIMITED
• UDACITY UK LIMITED
• VERED CONSULTING LIMITED
• WORKPLACE DRINK SOLUTIONS LTD

Winding-up Petitions (88)

• 321 CORPORATE PAYROLL LTD
• AGRI LIGHT LTD
• ALF ADVENTURES LTD
• AQUATAURUS VENTURES LTD
• ATAK KEBAB LIMITED
• B HOME SALES LTD
• BIZI PAY LTD
• BLUEPRINTED LTD
• BPL PROPERTY CARE HOMES LIMITED
• BRADNOCKS CONTRACTORS LIMITED
• BRF CONSTRUCTION LTD
• CASINO MK LIMITED
• CASTLE HILL CONSTRUCTION LTD
• CNEP MANAGEMENT LIMITED
• CONSENSIO GLOBAL LIMITED
• CONSTRUCTION SOLUTIONS (NORTH WEST) LIMITED
• COVER CALL BUILDING SERVICES LIMITED
• CSE ELECTRICAL LTD
• DATASWIFT NETWORK SERVICES LIMITED
• DELTA PAY LTD
• DONISON HOLDINGS LTD
• DRIVE 2000 LIMITED
• EMPIRE TRADING SOLUTIONS LTD
• ETA PRODUCTIONS LTD
• EVOLVE PAYROLL LTD
• FAYRESTABIL LIMITED
• FIGRIL LTD
• FOOD DEVELOPMENT SOLUTIONS LIMITED
• FOURTH WALL ENTERTAINMENT LIMITED
• HARE UK LIMITED
• HARTSTONE ROCHETTE LIMITED
• HERON ESTATES LIMITED
• HOMESOURCE APPLIANCES LIMITED
• ICE DESIGN & BUILD LIMITED
• IGI INEX HOLDING (UK) LTD
• INDRISEC LTD
• INTELLIGENT BUSINESS SALES LIMITED
• IPE MERCHANT STREET LIMITED
• JAMES YOUNG ENGINEERING LIMITED
• JK GARAGE EQUIPMENT LTD
• KANDY BUILD AND CONSTRUCTION LTD.
• KEYWAY LIMITED
• KMCO GROUP LIMITED
• KMS DRYLINING LIMITED
• KRIGER BOILERS UK LIMITED
• KWIK PICK LTD
• LOLFA CYF
• LOLFA LLANDEILO CYF
• LONGHAUL LOGISTICS LIMITED
• LUTAFO CONSULTING LIMITED
• M & B ACCOUNTING SERVICES LIMITED
• MAHF TRADING LIMITED
• MCF BRICKWORK LIMITED
• MERCO FACILITIES SERVICES LIMITED
• MOBYTZ LTD
• MUE ADMIN HR LTD
• NATURAL VENTILATION CONTROLS LIMITED
• NEXT LEVEL COURIERS LTD
• ONLINE SALES MANAGEMENT LTD
• PARAGON PSYCHOLOGICAL CONSULTANCY LIMITED
• PAYDOCKER UK LTD
• PELICAN PIER PROPERTIES LIMITED
• PHOTO PANDA LTD
• POLES APART CONSTRUCTION LTD
• PPUTL LTD
• PRESTINE ASSOCIATES LTD
• PRESTON ZABKA LIMITED
• QUANTUMSHARE LIMITED
• SAWN STONE LTD
• SOFRA INTERNATIONAL LIMITED
• SRS PAYROLL LTD
• SYKES ENERGY SERVICES LIMITED
• TELTECH 7 LIMITED
• THE ATLANTIC HOTEL PORTHCAWL LTD
• THE MILL HOUSE CAFE LTD
• THE SUBSTANTIA GROUP LIMITED
• TKBINI LTD
• TOTAL FUTURES LTD
• UNICORN1CARE LTD
• VANGUARD ENGINEERING DESIGN SERVICES LIMITED
• VANGUARD PROCESSING LTD
• VINDICO ICS LTD
• VISUALLY MINDED LIMITED
• VUP SERVICES LTD.
• WADEBOND LIMITED
• WAFFLEOPOLIS LTD
• WORK SAFE (CAMBS) LTD
• ZIPHOUSE LIMITED

Winding-up Orders (1)

• OUTLOOK TRAINING LTD

Protecting cashflow as costs and uncertainty rise

With tax decisions approaching and financing and energy costs still unsettled, firms selling on credit should review customer exposure, follow up promptly on missed payment dates and avoid allowing overdue balances to age unnoticed. CPA’s CreditCare credit reports and debtor monitoring can help identify changing customer risk, while consistent credit control supports better payment performance.

Where invoices become overdue, CPA can support recovery through the professional and considerate approach of its Overdue Account Recovery Service, designed to secure payment while preserving valuable customer relationships. This is a practical way to protect the value of completed work without unnecessarily damaging future trade.

Call CPA on 020 8846 0000 during business hours, Monday to Friday, 9am to 5pm. Email PaidQuick@cpa.co.uk or visit cpa.co.uk/contact-us.

When you see your money come in, you will be so glad you used CPA.

The Credit Protection Association : Prompting Punctual Payments : Ethical, Effective, Efficient, Economical collections.

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